Greening the Financial System

Greening the financial system is a project that strives to shift the Central Bank of Sweden’s gold- and foreign exchange reserve investment strategy to be more sustainable.

Climate change is one of the biggest challenges of our time. It affects how the economy works and it creates new risks in the financial market. Furthermore, the financial market is increasingly seen as vital in the transition to a sustainable and climate-neutral society. Since the Central Bank of Sweden has the outermost responsibility for price stability and to retain the currency’s value over time, it should be vital to find new ways to take sustainability aspects into account in its operations. Thus, it contributes to the work on climate change and other ESG-aspects to achieve its goal of long-term price stability.

Our project contributes to and accelerates this process. Together with the Central Bank of Sweden, we have been examining its feasibility to expand its existing sustainable investment strategy. More precisely, their possibility to invest in green bonds and/or other bonds that are considered to contributing to a sustainable development.

The result and the end product is a report with a proposal that will be presented to the top management at the Central Bank of Sweden in June 2020.